SBD/January 9, 2012/Marketing and Sponsorship

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  • Nike Dominating The Market For Shoe Contracts With NBA Players

    SportsOneSource analyst Matt Powell said Nike controls 97% of market

    The war among shoe companies for NBA players “isn’t much of a war anymore,” according to Jason Lloyd of the AKRON BEACON JOURNAL. SportsOneSource analyst Matt Powell said that Nike “controls 97 percent of the market” with endorsers including NBA HOFer Michael Jordan, Heat F LeBron James, Heat G Dwyane Wade and Thunder F Kevin Durant. Powell said, “I don’t want to declare the war over. But a non-Nike brand has a long way to go just to be competitive.” Lloyd reported that is “part of the reason adidas is rumored to be offering its top client, Chicago Bulls guard Derrick Rose, a staggering 10-year, $250 million shoe contract that has analysts shaking their head in disbelief.” Powell: “They’re talking about a silly amount of money. If they did that, it would strictly be a defensive move to prevent him from going to Nike. In terms of economics of having to pay a player that much money, I don’t think it’s a good move. I don’t see how they’d make that money back.” When it came time for Cavaliers G Kyrie Irving to sign a shoe contract as an NBA rookie, he “chose Nike over Under Armour and Adidas because of how it handled" the toe injury that limited Irving to 11 games during his one year in college at Duke. Irving said, “They have the best technology and the best doctors here and the best research that any shoe company has. It was a battle, but at the end of the day, Nike had the best medical stuff to offer for my feet.” Powell said of shoe contracts with rookies, “They don’t matter. If you look at No. 1 picks and their impact on footwear, LeBron was the last good one and there hasn’t been a great one for a long time. A lot of athletes are signing today for a very small amount of money and free shoes” (AKRON BEACON JOURNAL, 1/8).

    FEELING A CHANGE: Clippers G Chris Paul noted playing in L.A. after spending the first five years of his career with the Hornets has "definitely been a huge change” in terms of marketing opportunities, including his new signature Jordan Brand shoe. Paul said, “The shoe is special to me because everyone knows that I’m very, very family oriented.” The shoe features Paul’s wedding date, his son’s birthday and “61 little cutouts on my shoe ... that symbolizes my grandfather, because that was my best friend” (“Sports Biz: Game On!,” NBC Sports Network, 1/6).

    Print | Tags: Marketing and Sponsorship, Nike, Adidas
  • Reebok, McGarryBowen Link Again For New Campaign To Debut In Coming Weeks

    Reebok and ad agency McGarryBowen have “quietly reunited, and a new global brand campaign for the sports-apparel and equipment retailer is expected to debut in the coming weeks,” according to Parekh & Morrison of AD AGE. Kantar reported that Reebok in ’10 “spent a total of $75 million on domestic measured media.” That number “seems to have dipped a bit for 2011; spending from January through October was about $50 million.” But globally the overall spending “is likely to be much higher.” Reebok in ’04 “switched various creative assignments to McGarryBowen.” After some “time though, the relationship weakened, and in March 2009, Reebok announced it had appointed DDB Worldwide as its lead creative agency, to service the business from hubs in Chicago, Berlin and Hong Kong” (ADAGE.com, 1/6).

    THUMBS UP: adidas CFO Robin Stalker said that the company is “pleased” with its full-year ‘11 sales as the “world's second-largest maker of sports apparel targets record revenue.” Stalker: "We had raised the outlook several times in the course of the year and now can be very satisfied with the result." adidas is due to publish its ‘11 results on March 7 and the company has said that it “expects earnings per share growth of 10-15 percent in 2012, driven by the UEFA European soccer championship in Poland and Ukraine and the Olympic Games in London” (REUTERS, 1/7).

    Print | Tags: Marketing and Sponsorship, Reebok, Adidas
  • ESPN's OTL Discusses The Intense Criticism Of Cowboys' Apparel Production

    Cowboys now producing college apparel and facing criticism for using "sweatshops"

    Yesterday’s edition of ESPN’s “Outside The Lines” examined the outsourcing of merchandise sports apparel, with a focus on Cowboys apparel, most of which is produced in Third World countries. ESPN’s Mark Fainaru-Wada said the team is now “producing college apparel and facing intense criticism for using what is commonly known as ‘sweatshops.’” United Students Against Sweatshops Int’l Campaigns Coordinator Teresa Cheng said the Cowboys “have never come under public scrutiny for their labor rights violations in their overseas factories until now.” Cowboys Merchandising COO Bill Priakos said the team uses only a “few factories” and the organization “talks to them every day so there’s a lot of personal relationships there so we want to make sure we’re all doing the right thing.” ESPN travelled to a factory in Cambodia and Fainaru-Wada said, “We heard the same stories over and over again, of illegal working conditions, like forced overtime, as well as harassment and abuse by supervisors, all violations of the Cowboys' code (of conduct for overseas factories).” Priakos indicated the Cowboys "employ an independent auditor to regularly monitor and report back on working conditions in overseas factories like those in Cambodia.” Fainaru-Wada said the Cowboys' “critics say other sports apparel companies have dealt with factory violations, but have learned to be more engaged.” Priakos agreed with the suggestion that the Cowboys “have lagged behind on this issue.” He added, “We’re a small company. I don’t have the resources that Nike does … (but) we try to learn from them. We try to learn from everybody. We’re humble like that. We know we can do better.” Fainaru-Wada said a “merchandising person at a major BCS school” told ESPN that, “‘We wouldn’t do business with the Cowboys until we believe they got this’” (“Outside The Lines,” ESPN, 1/8).

    TRYING TO GET BUSINESS: ESPN.com’s Fainaru-Wada & Gubar wrote after earlier creating an ancillary company called Silver Star Merchandising, the Cowboys in May “struck a 10-year deal with USC to become the primary licensee of Trojans apparel.” The NFL team now “has its sights set on signing a handful of top-flight college programs.” Priakos said, “I think that we will definitely sign new schools in the future. … I think that this model kind of maxes out around 10.” Priakos has “been in talks with Ohio State for more than a year, trying to convince the Buckeyes to sign on, but those efforts have been muddied by student protests and media attention on the Cowboys' practices.” Ohio State Students Against Sweatshops said a deal with the Cowboys would be "a huge step backwards in the university's efforts to end sweatshop abuse in our college gear supply chain." From “labor rights organizations to representatives of other major brands, from licensing directors at big-time colleges to academics who have studied this issue for years, the message was the same: Violations are everywhere, it's the reality of the business, and no one has denied that for years.” Penn State Assistant Professor Mark Anner, who is the coordinator of the school's Project for Global Workers' Rights, said, “I feel like we're going back in time 15, 20 years. I've been researching, examining, looking at this industry for close to 20 years now, and I would have to say that's impossible. I've looked at auditing reports where I've seen, perhaps on average, 18 violations per factory. So problems, violations are extremely common” (ESPN.com, 1/7).

    Print | Tags: Marketing and Sponsorship, Dallas Cowboys
  • "SNL" Sends Up Corporate Sponsorship Prevalent During College Bowl Season

    "SNL" skit pokes fun at the number of bowl games on ESPN

    NBC’s “SNL” took aim at the college bowl season, mocking the various corporate sponsorship that support the games. A fake promo for ESPN’s coverage of bowl season aired, with the announcer saying, “Tune in tomorrow at 6:00 as Albion College looks to take on the Montclair State Hawks in ‘The Phantom Menace in 3D Radio Shack Croissant Bowl.’ Then at 8:00pm Buffalo State butts heads with Wheaton in the ‘Ruby Tuesday Hanes Her Way Prejudice Bowl,’ and on ESPNU at 10:00 Dickinson ’s running attack clashes with the stingy defense of Devry Institute in the ‘Mucinex Arizona Beef Council Pencil Bowl.’ Then at 4:00am the winless Delaware Valley Aggies look to salvage their dignity against the Styveson High School wrestling squad in the ‘Visine Dog#%*!* Dilbert Bowl.’ After that it’s the Texas A&M marching band versus tuberculosis in the ‘Fidelity Investments Four Loko Life Begins at Conception Bowl,’ and don’t miss three dogs versus 100 bats in the ‘Skechers Shape-Ups How I Met Your Mother Trojan Minis Bowl.’ … It’s bowl season on ESPN!” (“SNL,” NBC, 1/7). College Station-based KBTX-CBS' Steve Fullhart wrote on his Twitter feed, "Good luck to the Aggie Band when they face Tuberculosis in the Fidelity Investments Four Loko Life Begins at Conception Bowl."

    THE DAILY has a collection of reviews on how host Charles Barkley fared during Saturday night's show. 

    Print | Tags: Marketing and Sponsorship
  • Marketplace Roundup

    In Milwaukee, Don Walker reported Packers DT B.J. Raji “has some fun at the expense” of QB Aaron Rodgers in the new State Farm ad that debuted over the weekend. Raji in the ad is “signing off on a deal with his agent when Raji does Rodgers’ move,” the "Discount Double Check." Packers LB Clay Matthews was “part of the shooting but doesn’t appear in this ad.” State Farm officials said that some “additional footage may be shown on the Internet or other social media” (JSONLINE.com, 1/6). Deep Alliance Marketing Founder David Paro wrote, “State Farm killing one of the best-ever ads with an ill-conceived Discount Double Check sequel staring BJ Raji.”

    IN THE FAST LANE: In Ft. Lauderdale, Craig Davis noted Heat F Chris Bosh has “had an endorsement deal with Warren Henry Auto Group for more than a year,” and Friday the South Florida dealer announced that Bosh “will be the official celebrity spokesperson in 2012 promoting its Jaguar, Land Rover, Infiniti, Volvo, Lamborghini, Fisker and Subaru dealerships.” Bosh will “appear in television, radio and print advertisements and make special events appearances on behalf of the company” (SUN-SENTINEL.com, 1/6).

    HEALTHY CHOICES: In N.Y., Jeff Dinunzio wrote snowboarders Bryan Fox and Austin Smith last year “started writing ‘Drink Water’ on the decks of their snowboards alongside their sponsorship logos.” Shortly after, they “started selling stickers, jackets, T-shirts and sweatshirts with the Drink Water design” and their “campaign for water in favor of energy drinks was under way.” The Drink Water message “crept through the ranks of professional snowboarding” and soon, widely known snowboarders, “including Keegan Valaika and Scotty Wittlake, were wearing Drink Water sweatshirts at contests and in videos.” Fox and Smith said that their “opposition to energy drinks stemmed from the drinks’ ingredients” (N.Y. TIMES, 1/8).

    END OF THE ROAD: SCENEDAILY.com’s Bob Pockrass Friday reported Rusty Wallace Racing has “shut down its day-to-day racing operations as it continues to look for sponsorship for its two-car operation.” Drivers Steve Wallace and Michael Annett were “expected to compete in the Nationwide Series this season, and now both are looking for rides.” The organization “will keep some of its business staff in place to look for sponsorship for Wallace.” Team VP/Brand Management & Corporate Communications Greg Wallace said that the team “had about 35 people working in the shop” (SCENEDAILY.com, 1/6). Rusty Wallace said, “While we had several great partners on board for 2012, we just didn't feel like we had enough sponsorship in place to accomplish all of our goals” (ESPN.com, 1/6).

    Print | Tags: Marketing and Sponsorship, State Farm
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